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SECTION 7 - SEPARABILITY

SECTION 7 - SEPARABILITY. Adam Samuel. SECTION 7. Unless otherwise agreed Arbitration agreement intended or did form part of another agreement Not invalid because contract invalid, never came into existence or ineffective For this purpose – a distinct agreement. SEPARABILITY – SOME HISTORY.

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SECTION 7 - SEPARABILITY

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  1. SECTION 7 - SEPARABILITY Adam Samuel

  2. SECTION 7 • Unless otherwise agreed • Arbitration agreement intended or did form part of another agreement • Not invalid because contract invalid, never came into existence or ineffective • For this purpose – a distinct agreement

  3. SEPARABILITY – SOME HISTORY • 1698 Act – order of Court • 1746 Kill v. Hollister – ouster • 1802 Kent v. Elstob – error on face • Code Napoleon – prohibition of arbitration clauses

  4. THE PROCEDURAL CONTRACT • Procedure governed by lexfori • Exclusive jurisdiction clauses allowed choice of different law • Hamlyn v. Talisker dicta • Jörg v. Jörg 1915 Swiss TF • Arbitration = procedure (Cantonal) • Substance = federal • US FAA opposite

  5. MODERN SEPARABILITY • 1933 Swiss Tobler case • 1936 Norkoppings Sweden • 1950s Holland • 1963 Gosset – France • 1965 Strasbourg Uniform Law • 1967 Prima Paints US • 1970 Germany • 1976 Code judiciaire

  6. THE ENGLISH SAGA • 1894 Hamlyn v. Talisker dicta - arbitration clause & contract can be governed by different laws • 1926 HirjiMulji – frustration destroys arbitration clause • 1922Payne & Routh, 1927Joe Lee – one contract • 1942 Heyman v. Darwins – 3-2 split for one contract • 1953 Slade v. Metrodent – one contract saves clause in minor’s contract • 1980s Abandonment cases – separate contract • Black Clawson – three applicable laws

  7. MODERN ENGLISH SEPARABILITY • Harbour • Premium Nafta (Fiona Trust) • Purist view – no interest in main contract • UK & Swedish v. French, Swiss & US • Presumption in favour of clause width • Bumbesti – not entitled to arrest ship to enforce award

  8. JUSTIFICATIONS • Parties’ presumed intent • Presumption of survivability • Implied term designed to do parties good • Doesn’t do harm • Unitary contract idea – both private international law & validity

  9. THANK YOU • Any questions • Adam Samuel • www.adamsamuel.com

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